Rio Tinto offers workers at its Diavik diamond mine in Canada early termination of their contracts in hopes of saving money ahead of the mine’s closure.
Experts say the move was expected given the general challenges facing the diamond industry now. In addition, industry experts say it is natural for the workforce to be gradually reduced as the mine approaches its inevitable end of life.
According to the mine’s chief operating officer, Matthew Breen, Diavik is considering the voluntary separation as part of its efforts to manage costs and streamline its business.
Although the mine is set to close in 2026, some workers will remain at the site until 2029 while the company works through the closure and reclamation process. Diavik currently employs more than 1,200 workers. Despite the new workforce minimization initiative, Rio Tinto still sees a strong future for the mine over the remainder of its life.
“Although there are challenges in the current diamond market, the fundamentals are strong,” Breen added. “We are still seeing strong demand for Canadian diamonds of clean, sustainable provenance and we expect this to accelerate as we approach the closure of Diavik and our product becomes even more rare. We continue to be committed to the safe production of diamonds, fulfilling our commitments to our workforce and northern community partners, and to closing Diavik responsibly.”
Sales at Rio Tinto’s 100%-owned mine fell 40% year-on-year to $149 million in the first half of 2024. The figures reflect a global slowdown in rough diamond demand in the first half of the year. Polished diamond sales were weak in the period amid rising inventories.
Hélène Tarin, Editor-in-Chief of the Asian Bureau, Rough&Polished
